News Releases

Sierra Pacific Reports Earnings of Merged Companies

Nov 11, 1999

November 12, 1999
Sierra Pacific Resources
Contact: Mark Ruelle or Rich Atkinson
Phone: (775) 834-5400/(775) 834-4358

For Immediate Release

(Reno) - Sierra Pacific Resources (NYSE: SRP) today reported operating income of $103.0 million for common stock for the quarter ended Sep. 30, 1999. As required by Purchase Accounting regulations, these earnings represent three months operating income of Nevada Power, the acquiring company for financial reporting purposes, and two months operating income of Sierra Pacific Resources and its other subsidiaries, which include Sierra Pacific Power Company. Basic earnings per share were 93 cents for the quarter. Net income included non-cash charges of $9.8 million, or 14 cents per share pre-tax, for the quarter.

Reported operating revenues for Sierra Pacific Resources of $478.8 million for the quarter were driven largely by continuing growth in the service territories of the two utilities. Sierra Pacific Power reported increases of 2.7 and 3.0 percent in residential and commercial electric customers, respectively, over the third quarter of 1998. The gas and water businesses reported increases in customers of 4.4 and 5.9 percent, respectively, over 1998. Nevada Power reported increases of 6.0, 5.0 and 7.0 percent in residential, commercial and industrial customers, respectively, over the third quarter of 1998.

On an individual company basis, Sierra Pacific Power Company operating revenues increased 3.9 percent to $194.8 million and 5.2 percent to $539.3 million for the three and nine month periods, respectively. Income for common decreased by $10 million for the quarter and by $11 million for the nine months primarily as a result of an adjustment for AFUDC (Allowance for Funds Used During Construction) and higher depreciation charges. Nevada Power operating revenues increased 6.7 percent to $319.9 million and 11.3 percent to $770.2 million for the three and nine month periods, respectively. Increases in revenue were attributed mainly to customer growth and rate increases to recover deferred energy costs. Income for common was mainly flat for both periods due to reductions in use per customer caused by cooler summer weather offsetting the gains from customer growth.

"Higher revenues generated by the rapid growth in our service territories were offset by a mild summer in Nevada, therefore use per customer was down when compared with third quarter 1998," said Mark Ruelle, senior vice president, chief financial officer and treasurer."In addition, fuel expenses were also higher. Our goal is to increase net income by incorporating best practices of both organizations to take maximum advantage of the rapid growth in Nevada," said Ruelle.

Headquartered in Reno, Nev., Sierra Pacific Resources is a holding company whose principal subsidiaries are Nevada Power Co., the electric utility for southern Nevada and Sierra Pacific Power Co., the electric utility for most of northern Nevada and the Lake Tahoe area of California, and a natural gas and water distributor in the Reno - Sparks area. Other subsidiaries include the Tuscarora Gas Pipeline Co., which owns 50 percent interest in an interstate natural gas transmission partnership, e· three, an energy services company and Sierra Pacific Energy Company.

Sierra Pacific Resources merged with Las Vegas-based Nevada Power Company (NYSE: NVP) on Jul. 28, 1999. The combined companies will play a major role in the deregulation of the electric industry in Nevada, which is slated to commence in early 2000.

Sierra Pacific announced this week that it will be acquiring Portland based Portland General Electric for $2.1 billion from Enron Corp. The proposed transaction, which is subject to customary regulatory approvals, is expected to close in the second half of 2000 and will increase Sierra's customer base by 700,000.

Sierra Pacific ResourcesFinancial Highlights
(In thousands, except for per share amounts)

Third Quarter

Operating Expenses$375,861$250,85749.8%
Net Income Available for Common$64,700$61,9454.4%
Average Shares Outstanding$69,365$51,19835.5%
Net Income Per Share$0.93$1.21-23.1%

9 Months Ended September 30

Operating Expenses$744,358$569,00430.8%
Net Income Available for Common$80,851$79,2382.0%
Average Shares Outstanding$57,298$50,90212.6%
Net Income Per Share$1.41$1.56-9.6%